RESTOCKING SHELVES CALLED A PROBLEM AT WALMART

U.S. chief quoted, but spokesman cites ‘misinterpretations’

Walmart, already struggling to woo shoppers constrained by higher taxes, is “getting worse” at keeping shelves stocked, the retailer’s U.S. chief told executives, according to minutes of an officers’ meeting obtained by Bloomberg News.

“We run out quickly and the new stuff doesn’t come in,” U.S. Chief Executive Officer Bill Simon said, according to the minutes of the Feb. 1 meeting.

Simon said “self-inflicted wounds” were Walmart’s “biggest risk” and that John Aden, executive vice president of general merchandise for Walmart U.S., had been appointed to fix the restocking problem, according to the minutes.

Simon said he is trying to improve operations. “We need to start with the intent that our shelves will be full,” he said, according to the minutes.

Once a paragon of logistics, the world’s largest retailer has been trying to improve its restocking efforts since at least 2011, hiring consultants to walk the aisles and track whether hundreds of items are available. It even reassigned store greeters to replenish merchandise. The restocking challenge emerged as Walmart was returning more merchandise to shelves after a previous effort to de-clutter its stores.

Walmart’s inability to keep its shelves stocked coincides with slowing sales growth. Same-store sales in the U.S. for the 13 weeks ending April 26 will be little changed, Simon said in the company’s Feb. 21 earnings call.

“These are personal notes from one participant in the meeting and are not official company minutes,” said David Tovar, a Walmart spokesman. “There are a number of significant misinterpretations and misleading statements that do not accurately reflect the comments by Bill Simon or any other participant in the meeting.”

When Simon said things were “getting worse” he was referring to “modular changes,” the process of replenishing merchandise to keep up with customer demand and changing seasons, Tovar said. Walmart is working to “manage this in the most efficient way possible,” he said.

“We’re very pleased with our in-stock position,” he said.

Evelin Cruz, a department manager at the Walmart Supercenter in Pico Rivera, said Simon’s comments from the officers’ meeting were “dead on.”

“There are gaps where merchandise is missing,” Cruz said. “We are not talking about a couple of empty shelves. This is throughout the store in every store. Some places look like they’re going out of business.”

Tovar said Cruz’s “comment appears to be national in scope. I doubt she had been to other Walmart stores. I take issue with the quote.”

Cruz, 41, who has worked at Walmart for nine years and oversees the photo and wireless sections at her store, said it can take weeks or months for merchandise to be replaced after it sells out. “My camera bar hasn’t had cameras since early January,” she said. “They let the merchandise phase out but nothing new comes in to replace them.”